Factors critical to a sustainable deployment of Lean Six Sigma in Australian business.
thesisposted on 01.03.2017, 00:01 by Hilton, Roger John
Over the last two decades, manufacturers in Australia have implemented process improvement methodologies to assist in driving down the costs of operations brought on by customers wanting better quality and responsiveness. Closely following in the footsteps of the manufacturers, since the early 2000’s, are service organizations, including those in Healthcare, Finance/Banking, IT and Government (Public sector). Lean Six Sigma is one such process improvement methodology. It is seen as the latest philosophy of continuous improvement in many companies world-wide. Following an extensive literature review, it is clear that Lean Six Sigma has been based on earlier continuous improvement philosophies like Total Quality Management as well as the combination of Lean and Six Sigma. There are clearly some similarities and differences between Lean Six Sigma and Total Quality Management. It is not clear in the literature whether companies are deploying Lean Six Sigma because the previous initiatives failed and it will result in better outcomes or it is a natural progression to adopt a new innovation and a new technique. It is not clear if the drivers to deploy Lean Six Sigma are different to previous quality improvement initiatives. Total Quality Management was introduced in the 1980’s to create a culture of continuous improvement, improve quality and enhance an organization’s competitive advantage and it is interesting to establish if Lean Six Sigma has been deployed to deliver something else or the same since Total Quality Management did not deliver the expected benefits. It is clear in the literature that Lean Six Sigma has been successful but success seems to vary according to the performance or success measure used. For example, if success is defined as higher market share then Lean Six Sigma may not be deemed successful but if success is defined as process cost reduction or savings resulting from an improvement project due to better delivery performance and process capability then it may be deemed successful. The literature covers the concept of a “Mature” deployment of Lean Six Sigma which is another way of measuring success apart from success from improvement projects. An organization which has a high level of maturity and where projects are successful is one that is likely to have a culture of sustainable continuous improvement. Little attention has been directed towards how Lean Six Sigma should be deployed. Some companies have deployed Six Sigma first then Lean and other companies have deployed Lean first to identify low hanging fruit and then implemented Six Sigma and others have implemented the combined program from day one. Also, the literature suggests that deployment of Lean Six Sigma needs to be different in small and medium-sized organizations. In the literature, it is clear that the phases of a Six Sigma methodology (Define-Measure-Analyze-Improve-Control) are well-defined but there has been little attention given to the definition of what constitutes a Lean Six Sigma methodology. For example, in many companies Lean Six Sigma deployments use the DMAIC methodology and also use Lean tools at various stages and in others Lean is separately deployed concurrently with DMAIC. Factors critical to success of Lean Six Sigma have been identified in the literature. It is unclear whether these factors are critical to short-term gains or long-term sustainable benefits. This phenomenon also seems to be the case for Total Quality Management (TQM) implemented by many organizations around the world during the 1990’s. Included in these critical success factors for Lean Six Sigma is the need for highly-trained Lean Six Sigma experts, known as Master Black Belts and Black Belts (and other levels of “Belts”) and the importance of corporate or organizational factors. In the literature the concept of a competency-based perspective of these factors is introduced. In Australia, Lean Six Sigma has been deployed successfully in many companies involved in manufacturing and service, both large and small and medium-sized and in the public sector. However, it has been disbanded in some companies because of an apparent failure of the program, which also appears to be the case for some Total Quality Management deployments. It is unclear as to why this has happened but it is suggested that it is so due to the different measures of success of the program. Also in Australia, some anecdotal evidence suggests that the ongoing deployment of Lean Six Sigma is susceptible to a change of the Chief Executive Officer of the organization. Other evidence suggests that the companies that disbanded the program some years ago are re-deploying it using funding provided by the Australian Federal and State Governments. Further evidence suggests that the Lean Six Sigma programs are now becoming very successful in many other industry sectors like Healthcare and Government in Australia. Thus, in this thesis the researcher considers the following research questions relating to a Lean Six Sigma deployment. 1. What are the key drivers and success measures of a Lean Six Sigma deployment? 2. How has Lean Six Sigma been deployed and is it affected by organizational size? 3. What are the competencies of an organization that result in the successful deployment of Lean Six Sigma? 4. What are the personal competencies of the deployment leader and project leaders for the Lean Six Sigma deployment to be successful? 5. What success factors are common between Lean Six Sigma and previous quality improvement initiatives such as Total Quality Management (TQM)? In developing and examining these questions, a comprehensive literature review and four fieldwork phases involving qualitative and quantitative research was completed. There are two fieldwork phases using qualitative research (fieldwork phases 1 and 3) and two fieldwork phases using quantitative research (fieldwork phases 2 and 4). Fieldwork phase 1 (Chapter 4) involves face-to-face interviews using semi-structured questions with senior managers in organizations in Australia that have deployed Lean Six Sigma. Seven case organizations have been selected – four cases in manufacturing and three in service. This has revealed a number of significant issues relating to key drivers, deployment strategies, critical success factors and challenges and benefits of the deployment. Factors critical to success include organizational competencies and competencies of the experts involved in Lean Six Sigma. Fieldwork phase 2 (Chapter 5) considers an in-depth analysis of Lean Six Sigma in one of the seven organizations. The aim of fieldwork phase 2 was to gain insights into the relationship between critical success factors and performance measures for this case. The case was in Healthcare and was chosen as a result of the interest of the interviewee in fieldwork phase 1 to examine their improvement program more fully using input from all senior managers. Fieldwork phase 3 (Chapter 6) involves the use of an open questionnaire with two Lean Six Sigma experts. The aim of fieldwork phase 3 was to gain further insights into the required competencies of the Master Black Belt and Black Belt in Lean Six Sigma. Using the insights from fieldwork phases 1, 2 and 3, a model for the sustainable deployment of Lean Six Sigma program was developed. Sustainability is defined as the combination of successful projects and a level of maturity of the Lean Six Sigma deployment. Fieldwork phase 4 (chapter 7) involves testing the developed model using a National Survey of Operations Excellence Managers in Australian organizations that have deployed Lean Six Sigma. The aim of fieldwork phase 4 is to obtain objective evidence of what factors are critical for a sustainable Lean Six Sigma deployment. A number of key insights are revealed contributing to the theory and practice of Lean Six Sigma. A discussion of the key insights are presented in chapter 8 followed by conclusions and recommendations being presented in chapter 9.